Rethink sales tax holidays

Rethink sales tax holidays

Gazette Column
Sales tax holidays like the one happening in Iowa this weekend may sound nice, but they aren’t good public policy. And, yes, I can already hear groaning from the parents and grandparents reading that first sentence. Bear with me. For those who are unfamiliar, for the past 16 years, Iowa residents have been given two days in August to purchase various back-to-school items that cost under $100 without paying sales taxes. In addition, since 2000, the legislature has mandated that all retailers participate. Supporters of these holidays assert the incentive stimulates the economy by encouraging shoppers to purchase more of the goods included on the state’s tax-free list, even if some are impulse buys. But, research has time and again shown this to be false. The New York State Department…
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